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Fines as enforcers’ rewards or as a transfer to society at large? Evidence on deterrence and enforcement implications

Author

Listed:
  • Florian Baumann
  • Sophie Bienenstock

    (UP1 - Université Paris 1 Panthéon-Sorbonne)

  • Tim Friehe
  • Maiva Ropaul

Abstract

We analyze experimental data to assess whether the deterrent effect of expected fines depends on who receives the fines' proceeds. We compare behavior in treatments when the revenue is a reward for enforcement agents to the alternative when fines are transferred to society at large. Most important, with a fixed detection probability, potential offenders' material incentives are held constant across treatments. Our evidence suggests that the deterrent effect of expected fines is greater when enforcement agents obtain the fine revenue. Our results also document that the characteristics of enforcers who are willing to incur private costs to create a positive detection probability seem to depend on whether fines reward enforcers or are transferred to society at large.

Suggested Citation

  • Florian Baumann & Sophie Bienenstock & Tim Friehe & Maiva Ropaul, 2022. "Fines as enforcers’ rewards or as a transfer to society at large? Evidence on deterrence and enforcement implications," Post-Print hal-03962981, HAL.
    • Handle: RePEc:hal:journl:hal-03962981
    DOI: 10.1007/s11127-022-01000-5
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    More about this item

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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